Professional Documents
Culture Documents
2d 167
The Bell System is one of the largest employers in the United States.
Traditionally, its operating companies have been organized along departmental
lines. The plant department has been responsible for installation and
maintenance of physical facilities such as central office equipment,
transmission lines, and subscriber telephones. The traffic department has been
responsible for putting calls through, operator assistance, information, and
related services. The commercial department has handled subscriber sales and
billing. The accounting department has performed the bookkeeping and
accounting functions. Until at least the late 1960's, Bell System hiring practices
generally followed departmental lines. The plant department, in which craft
jobs predominated, was traditionally a male preserve, while female employees
were generally employed as operators, bookkeepers, or in other clerical
occupations in the traffic and commercial departments. Pay scales at both entry
and higher levels in the plant department were, and remain, higher than for
employees with comparable length of service in the other departments.
Transfers from the traffic or commercial departments were possible, but there
was a general policy of slotting a transferred employee in at the next higher pay
rate than that last enjoyed in the previous position. Since traffic and
commercial employees had lower starting rates and lower rates at each step of
the wage progression schedule, that policy resulted in a transferee to the plant
department receiving a lower rate of pay than would an employee performing
the same job who had been hired on the same date, but who had started in the
plant department. These hiring practices resulted in a concentration of males
and females in certain classifications. Moreover, there was an imbalance
between the racial and ethnic composition of the work forces of many operating
companies and the racial and ethnic makeup of their available labor markets.
The intervening defendants do not dispute that past patterns and practices were
discriminatory, nor do they dispute that the present work force in many Bell
System departments still reflects those past patterns and practices.
4
The Consent Decree directs the Bell System Companies to establish goals and
intermediate targets to promote the full utilization of all race, sex, and ethnic
groups in each of fifteen job classifications. The intermediate targets, set
annually, reflect the representation of such groups in the external labor market
in relevant pools for each operating company's work force. The intermediate
targets are the major prospective remedies in the Consent Decree. When any
Bell Company is unable to achieve or maintain its intermediate target, applying
normal selection standards, it is required by the decree to depart from those
standards in selecting candidates for promotional opportunities. It must then
pass over candidates with greater seniority or better qualifications in favor of
members of the under-represented group who are at least "basically qualified."
Without this affirmative action override, the greater time in title of incumbent
members of the overrepresented race, sex, or ethnic group would inevitably
reduce the opportunity for advancement of the under-represented groups and
would perpetuate the effects of the former discrimination. The affirmative
action override applies, however, only to minority promotional opportunity. A
promotion under the override does not result in any increase in competitive
seniority for purposes of layoff or rehire, as to which the collective bargaining
agreements control.2 The life of the decree is six years, ending on January 17,
1979. It provides that AT&T may bargain collectively with collective
bargaining representatives for alternative provisions which would also comply
with federal law. No such alternative provisions have been presented to the
district court.
Since the only alleged conflict between the collective bargaining agreements
and the Consent Decree and supplemental order relates to promotional
seniority, our starting point is a description of bargained-for promotional
practices. The contracts between AT&T and each of the intervening defendants
are not identical. As to each intervening defendant there are also variations, in
contracts with specific operating companies, negotiated locally to reflect local
conditions and practices. However, a common feature of all the agreements is
that seniority for all purposes is determined by "net credited service" in any
department in the Bell System. It is also common to provide that in selecting
employees for promotion, other factors being equal, the Company will promote
the employee with the greatest net credited service. However, it is clear that the
company has not bargained to the union any role in the determination of
employee qualifications. Some agreements refer to "the employee whom
Company finds is best qualified." Others speak of "ability, aptitude, attendance,
physical fitness for the job, and proximity to the assignment." Some agreements
even qualify the seniority-equal qualification language by language to the effect
that "(n)othing in this paragraph shall be construed to prevent Company from
promoting employees for unusually meritorious service or exceptional ability."
Although their approach to the alleged conflict between the Consent Decree and
their collective bargaining agreements is not identical the intervening
defendants agree that the bargained-for promotional system is a merit selection
system. Management determines the employee best qualified in its judgment,
but seniority decides the issue where two employees are considered by
management to be equally qualified. The effect of the affirmative action
override, then, where and when it operates, is to eliminate from consideration
those employees who would normally have been selected under pre-decree
practice. The decree provides for selecting, from the under-utilized group of
persons, those who in the judgment of management are "basically qualified."
Although the briefs of the intervening defendants stress the issue of competitive
seniority, the real dispute is less over seniority, which under the contracts
would only be determinative in cases of equal qualification, as over the
departure from the "best qualified" criterion. The continued operation of that
criterion would, of course, significantly confine promotions within
departmental lines, as has been the past practice, since experience in the
department will always be a significant factor in an employee's qualification
level. By executing the Consent Decree AT&T has agreed, in the instances in
which the affirmative action override applies, to limit its bargained-for
management prerogative of determining the employee best qualified for
promotion, so long as it promotes a basically qualified applicant from an underrepresented group. The unions urge that it may not do so without illegally
breaching their collective bargaining agreements and the rights of some of the
employees they represent.
IV. THE UNION CONTENTIONS
7
The unions contended in the district court, and contend somewhat less
These cases hold that approval of such a settlement, arrived at after negotiations
between the defendant and the class representative, will be reversed only if the
court abused its discretion in approving it. There is, of course, a difference
between approving a settlement benefiting a plaintiff class whose
representative negotiated it, and approving a settlement imposing burdens on
an unrepresented class of defendants. The recognition of that difference was the
very reason why in Equal Employment Opportunity Commission v. American
Telephone & Telegraph Company, supra, 506 F.2d at 741-42, we held that
CWA could move to intervene as a defendant. Following intervention the
unions were permitted a full opportunity to convince the court that the relief
AT&T had agreed to went beyond that required to remedy the violation. The
posture of the case before us is, for all practical purposes, that of a fully
litigated decree.
The intervening defendants also urge several separate challenges to the decree,
based on their interpretation of 706(g). The first of these is that the section
prohibits quota remedies, and that the interim targets and goals of the Consent
Decree amount to such a remedy. That challenge is also foreclosed by Elevator
Constructors, supra, and we will not repeat the analysis of the legislative
history of the 1972 amendments to Title VII upon which we relied in rejecting
it.3
13
14
The unions' major challenge to the decree, however, is that in all our prior Title
VII remedy cases, and in those in the Supreme Court as well, the remedy
provided relief only in favor of identifiable victims of specific past
discrimination. They contend that 706(g) proscribes any decree, even in a
class action, which would permit relief to a minority group member who could
not so identify himself.
15
The intervenor defendants misread our prior authority. Nothing in the decree
which we approved in Elevators Constructors limited its applicability to blacks
who had applied and been rejected for membership in the union. The decree ran
to the benefit of the class of persons found to have been underutilized by virtue
of a discriminatory pattern or practice. Moreover, the contention ignores the
fact that in this case the United States sued to enforce Executive Order No.
11246. In Contractors Ass'n of Eastern Pa. v. Secretary of Labor, 442 F.2d 159
(3d Cir. 1971), we held that the Executive Order was a valid effort by the
government to assure utilization of all segments of society in the available labor
pool for government contractors, entirely apart from Title VII. Certainly that
broader governmental interest is sufficient in itself to justify relief directed at
classes rather than individual victims of discrimination. It is undisputed that the
Bell System is a major governmental contractor.
16
17
Before doing so, we note that even if we were to accept the unions' position on
706(g), this decree would have a large scope of valid operation. The chief
charge is that for years Bell System hiring practices steered certain classes of
persons into certain departments. Any member of the affected class who
became a Bell System employee during the time the practices operated was
affected by them, at least to the extent that he or she was not informed that
employment opportunities might exist in other departments. We do not think
that Congress, in enacting Title VII, intended that 706(g) remedies be
available only to those knowledgeable enough and militant enough to have
demanded and been refused what was not in fact available. All who became
employees while the challenged employment practices operated were
individual victims of the practice. Thus the unions' objection only goes to the
possibility that some minority group members, hired after the offending
practices ceased, might be able to take advantage of the affirmative action
override. No record was made in the district court, by the intervening
defendants or anyone else, to establish whether there is a significant number of
such persons. Recognizing that there are thousands of class members who
could validly be protected, even on the unions' construction of 706(g), we
would find it extremely difficult to set aside the decree in the absence of such a
record. The district court in framing a remedy could certainly balance the
possibility that some recent hires who were not affected by the offending prior
practices might be advantaged against the practicality that the decree had to be
simple enough in operation to achieve its main purpose. Thus, we would not
reverse even if we agreed with the intervening defendants' interpretation of
706(g).
18
The unions urge that any relief going beyond class members who can show that
they, rather than the class to which they belong, have been discriminated
against is proscribed.
21
The last sentence in 706(g) must be read in light of the settled construction of
the rest of the section. That settled construction is that once a prima facie
showing is made that an employer has engaged in a practice which violates
Title VII, the burden shifts to it to prove that there is a benign justification or
explanation.4 The last sentence of 706(g) says precisely that. Obviously, an
employer can meet an individual charge by showing that although that
individual was a member of the disadvantaged class he was also a thief, or a
drunk or an incompetent, and was for such a reason denied employment or
promotion. But the sentence does not speak at all to the showing that must be
made by individual suitors, or class representatives on behalf of class members,
or the EEOC on behalf of class members. The sentence merely preserves the
employer's defense that the non-hire, discharge, or non-promotion was for a
cause other than discrimination. Nothing in the Consent Decree prevents AT&T
from asserting that defense with respect to individual applicants for promotion,
and it is difficult to see what interest the unions have in it.
22
The sparse legislative history available on the bills which became Title VII
confirm our interpretation of the sentence. In H.R. 7152, what is now 706(g)
appeared as 707(e). A section-by-section analysis contained in
H.R.Rep.No.914, 88th Cong. 1st Sess. (1964), states of the latter:
24
25
26
27
28
We turn then to the contention that even assuming the existence of statutory
authority, the district court abused its discretion in refusing to grant the unions'
motions to modify the Consent Decree, and in entering the Supplemental Order.
As with equitable remedies generally, the scope of relief is a matter entrusted in
the first instance to the trial court. As the Supreme Court has made plain,
however
"30. . . that discretion imports not the court's ' "inclination, but . . . its judgment; and
its judgment is to be guided by sound legal principles." ' Discretion is vested not for
purposes of limit(ing) appellate review of trial courts, or . . . invit(ing) inconsistency
and caprice, but rather to allow the most complete achievement of the objectives of
Title VII that is attainable under the facts and circumstances of the specific case. 422
U.S., at 421 (95 S.Ct. 2362.) Accordingly the District Court's denial of any form of
seniority remedy must be reviewed in terms of its effect on the attainment of the
Act's objectives under the circumstances presented by this record." Franks v.
Bowman Transp. Co., supra, 424 U.S. at 770-71, 96 S.Ct. at 1267.
31
In Franks, the Court reviewed the denial rather than the award of relief, but it is
equally relevant to the scope of appellate review of the award of relief as well.
As we pointed out in Part IV A, supra this case comes to us after actual
litigation by the intervening defendants over the scope of relief. Thus it is
closer, procedurally, to Franks v. Bowman, supra, than to Bryan v. Pittsburgh
Plate Glass Co., supra, and Kober v. Westinghouse Electric Corp., 480 F.2d
240, 247-50 (3d Cir. 1973), in which we reviewed settlements objected to by
plaintiff class members. But whether we apply the standard of appellate review
for litigated Title VII cases or that for review of settlements, considerable
deference must be accorded the decision of the trial judge as to remedy.
32
The intervening defendants do not dispute that past hiring practices violated the
law, that the makeup of the work force in many Bell System departments
reflects the present effects of those past practices, or that continuance of the
"best qualified" criterion for promotion, by rewarding experience in a given
department, would tend to perpetuate those effects. Nor have they urged
(except in their general attacks against all affirmative action targets and goals)
that relating the targets and goals to minority representation in the available
work force was error. They do contend that other means of attaining those
goals might have been resorted to, and might be equally effective. But the
decree preserves for the unions the opportunity to bargain collectively for such
alternative means. The district court gave careful consideration to all the union's
Finally, the intervening defendants challenge the decree on the ground that any
court-imposed remedy requiring a quota, target or goal defined in terms of sex,
race or national origin violates the due process clause of the fifth amendment.
In its broadest reach, this argument is that any class action remedy for
discrimination against minorities is unconstitutional, for any such remedy of
necessity defines the protected class. We are not asked to go quite that far. The
unions do not object to the provisions of the decree prohibiting employment
discrimination in the future. Their objection is to the provisions for overcoming
the effects of past practices. We have rejected the same constitutional
arguments against affirmative action remedies in the past. United States v. Int'l
Union of Elevator Const., supra, 538 F.2d at 1018; Erie Human Relations
Comm'n v. Tullio, supra; Contractors Ass'n of Eastern Pa. v. Secretary of
Labor, supra, 442 F.2d at 176. See Oburn v. Shapp, 521 F.2d 142, 149 (3d Cir.
1975) (Garth, J.). The intervening defendants would have us distinguish these
cases because they did not involve competitive seniority, and thus did not
involve contractual interests of other employees. We pointed out above that
Elevator Constructors did involve competitive seniority. But in any event the
proposed distinction is unavailing. Franks v. Bowman Transp. Co., supra,
holds that the contractual interest of an employee in competitive seniority must
yield to an appropriate Title VII remedy. See 424 U.S. at 778, 96 S.Ct. 1251.
Federal statutory remedies need not be color blind or sex unconscious.7
34
We recognize that the remedy adopted by the district court can operate to the
disadvantage of members of groups which have not previously been
discriminated against compared to members of sex or racial groups previously
subject to discrimination who have not themselves been discriminated against.
The remedy thus constitutes federal action which classifies by membership in a
sex or racial group, and must be held invalid under the equal protection
guarantee inherent in the due process clause of the Fifth Amendment unless it
can be shown that the interest in making the classification is sufficiently great.
35
The standard applied by the Court in evaluating that interest has differed
somewhat for sex as opposed to racial classifications. Racial classifications are
subject to strict scrutiny: the federal "purpose or interest" must be "both
constitutionally permissible and substantial," and the "use of the classification"
must be " 'necessary . . . to the accomplishment' of (the) purpose or the
safeguarding of (the) interest." In re Griffiths, 413 U.S. 717, 721-2, 93 S.Ct.
2851, 2855, 37 L.Ed.2d 910 (1973) (footnotes omitted). On the other hand,
"classifications by gender must serve important governmental objectives and
must be substantially related to achievement of those objectives." Craig v.
Boren, 429 U.S. 190, 197, 97 S.Ct. 451, 457, 50 L.Ed.2d 397 (1976). The
present classifications are permissible in the case of race, and are thus
permissible a fortiori with respect to sex.
36
The federal interest in the present case is that of remedying the effect of a
particular pattern of employment discrimination upon the balance of sex and
racial groups would otherwise have obtained an interest distinct from that of
seeing that each individual is not disadvantaged by discrimination, since it
centers on the distribution of benefits among groups. This purpose is
"substantial" within the meaning of In re Griffiths, supra,8 where the Supreme
Court said that "a State does have a substantial interest in the qualifications of
those admitted to the practice of law . . . " 413 U.S. at 725, 93 S.Ct. at 2856.
The governmental interest in having all groups fairly represented in
employment is at least as substantial, and since that interest is substantial9 the
adverse effect on third parties is not a constitutional violation. Moreover, the
same exclusion of such members could conceivably result from remedies
afforded to individual victims of discrimination. This remedy operates no
differently. Furthermore, as we noted above, the affirmative action override is
necessary to the practical accomplishment of the remedial goal.
37
It will doubtless be possible to detail, and thus to employ remedies other than
quotas, for many individual instances of discrimination. But it is also true that
much discrimination cannot be proved through evidence of individual cases,
even though a prima facie case can be made out on the basis of statistical or
other evidence. It will, for example, be nearly impossible to show that
individuals were deterred from applying for hiring or promotion, or from
attempting to meet the prerequisites for advancement, because of their wellfounded belief that a particular employer would not deal fairly with members of
their particular sex or racial group. Moreover, even apart from problems of
proof, goals and quotas are necessary to counteract the effects of discriminatory
practices because some victims of discrimination no longer seek the job
benefits which they were discriminatorily denied. In such cases, quotas are
needed to counteract the effects of discriminatory practices upon the balance of
The use of employment goals and quotas admittedly involves tensions with the
equal protection guarantee inherent in the due process clause of the Fifth
Amendment. But the remedy granted by the district court is permissible
because it seems reasonably calculated to counteract the detrimental effects a
particular, identifiable pattern of discrimination has had upon the prospects of
achieving a society in which the distribution of jobs to basically qualified
members of sex and racial groups is not affected by discrimination.
39
United States v. Int'l Union of Elevator Const., 538 F.2d 1012, 1017 & n. 8 (3d
Cir. 1976). See Franks v. Bowman Transp. Co., 424 U.S. 747, 772, 96 S.Ct.
1251, 47 L.Ed.2d 44 (1976). Cf. Albemarle Paper Co. v. Moody, 422 U.S. 405,
425, 95 S.Ct. 2362, 45 L.Ed.2d 280 (1975); McDonnell Douglas Corp. v.
Green, 411 U.S. 792, 802, 95 S.Ct. 1817, 36 L.Ed.2d 668 (1973)
See, e. g., Ostapowicz v. Johnson, 541 F.2d 394 (3d Cir. 1976), cert. denied,
429 U.S. 1041, 97 S.Ct. 741, 50 L.Ed.2d 753 (1977); Erie Human Relations
Comm'n v. Tullio, 493 F.2d 371 (3d Cir. 1974); Commonwealth v. O'Neill, 473
F.2d 1029 (3d Cir. 1973) (per curiam) (in banc ); Kirkland v. New York State
Dept. of Correctional Serv., 520 F.2d 420, 430 (2d Cir. 1975), cert. denied, 429
U.S. 823, 97 S.Ct. 73, 50 L.Ed.2d 84 (1976)
The Court said in footnote 9 of its opinion that: "The state interest required has
been characterized as 'overriding,' (McLaughlin v. Florida, 379 U.S. 184, 196,
85 S.Ct. 283, 13 L.Ed.2d 222 (1964)); Loving v. Virginia, 388 U.S. 1, 11 (87
S.Ct. 1817, 18 L.Ed.2d 1010) (1967); 'compelling,' Graham v. Richardson, (403
U.S. 365, 375, 91 S.Ct. 1848, 29 L.Ed.2d 534 (1971)); 'important,' Dunn v.
Blumstein, 405 U.S. 330, 343 (92 S.Ct. 995, 31 L.Ed.2d 274) (1972), or
'substantial,' ibid. We attribute no particular significance to these variations in
diction."
See findings in House Judiciary Committee Report on H.R.7152, reprinted in
E.E.O.C., Legislative History of Titles VII and XI of Civil Rights Act of 1964
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